New Zealand house prices have reached a new milestone, with the national average property value hitting $1 million for the first time. New figures from OneRoof and its data partner Valocity show the typical cost of a property across New Zealand increased 4.9% in the last three months and increased 27% since September 2020.
The doubling of the national average property value in less than a decade will put further pressure on first home buyers, and many may see deposit requirements pushed up to $200,000 - more than three times the average annual wage.
OneRoof editor Owen Vaughan said: “The figures show the extent of the house price surge after the first Covid lockdown last year and raise concerns that measures aimed at slowing house price growth are not working fast enough. House-hunters are now spending about $213,000 more than they did a year ago on the typical home.”
He said much of the national growth has been fuelled by price jumps of more than 30% in Gisborne, Manawatu-Whanganui, Wellington, Hawke's Bay and Bay of Plenty.
“The acceleration in house prices has seen Wellington and Tauranga join Auckland and Queenstown-Lakes in the $1,000,000 club, with Hamilton, Napier, Hastings, Nelson and Whangarei not far behind,” he said.
“It’s amazing to think that the average property value for all of New Zealand has hit one million less than 20 years since the country recorded its first million dollar suburb and Auckland became the first million dollar city,” said Vaughan.
Auckland remains the most expensive place to buy property, Vaughan said, with the city recording an average property value of $1.415m (up 24% on last year) while West Coast is New Zealand's most affordable housing market, with an average property value of $353,000.
Despite the price increases, first-home buyers' share of new mortgage registrations over the year has held steady at around 40%, Vaughan said.
“But the surge has meant that buyers searching now would need to stump up $50,000 more for a 20% deposit than those purchasing this time last year.”
The price growth is taking place against a backdrop of a slowdown in listings and sales volumes, and expectations that prices will jump further once the country is fully out of lockdown and buyers try to secure a home before expected interest rates rise.
Nationally, there were 6% fewer homes available for sale in August month compared to July and 36% fewer listings than in August 2020.
The monthly drop in new listings was even sharper, with the number of new properties coming to market last month down nearly 19% on the month before.
“Interest in property had surged during the Covid lockdown, with visits to OneRoof in the last month up almost 10% on the month before,” said Chief of OneRoof Paul Maher.
“Covid hasn't curbed Kiwis' appetite for property. In fact, the opposite is true. Most buyers and sellers will be well aware of what happened to prices after the country came out of the last national lockdown.
"The fact that readership of our property news and housing market insights over the lockdown has jumped 25% on the month before shows Kiwis want to stay updated and are hungry to know more about what's happening in these uncertain times," said Maher.